Is Microsoft's Aquantive Buy A Warning Sign?

from the at-the-summit dept

Fri, May 18th 2007 2:54pm — Joseph Weisenthal

This morning's announcement that Microsoft would buy Aquantive at a staggering premium has a lot of people wondering whether the deal might be some sign of a bubble. By almost any metric, the deal was very rich, which leads to some serious questions about whether Microsoft can get a good return on its investment. Everyone guessed that Microsoft still wanted to do a deal following its failure to win DoubleClick, but as Felix Salmon cleverly points out, the one silver lining for Microsoft after losing DoubleClick was that Google ended up being saddled with the enormous bill. Now it's Microsoft's turn to suffer the "winner's curse". To put it into a bit more perspective, it's this will be the company's biggest acquisition of all time, which is good evidence that the company desperately wants to diversify away from simply being a software company. Of course, with as much cash as the company has in its accounts, it can afford to make a few desperate moves.

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RandomThoughts, 18 May 2007 @ 3:59pm

This is good evidence that the company wants to diversify away from software? Wasn't Balmers statement of that a while ago a good clue? At least you guys are not like Engadget, you really make sure you have ALL the facts before you cover something.

Everyone in the world knew Microsoft had to make a move. Yahoo wasn't just a rumor, it was actually being considered.
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Anonymous Coward, 18 May 2007 @ 4:00pm

I dont know how microsoft will ever make its money
$6,000,000,000
/
$200,000,000/year
=
30 years

In 30 years, technology will have changed so much, that this product will likely no longer exist.
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Brandon Watts, 18 May 2007 @ 4:38pm

Microsoft Fever
This deal is worth so much money that it's trivialized the actual reason behind the purchase. So far, it seems like almost everyone has talked about the astounding amount of money that was placed on the table instead of what all of this will actually mean for the company.

You've done it again, Microsoft. Thanks for the shock.

Brandon Watts
Criteo Evangelist
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Michael G., 18 May 2007 @ 5:23pm

How can anyone not think Microsoft is in a corner.
It’s the ol' cliché 'too big for its own good." The time was right for Microsoft to grow like it did when it did but now that pace is getting too fast for even Microsoft to keep up. Nobody really wants to go to Vista, it’s only because we have to that most of us will. Some of us are going to be searching out better things and Microsoft knows they’re out there for us to use. They’ve been doing this for years. Now again it’s time to play catch-up and its costing them 6 billion to do it. I don't even think they know themselves if they have the power to recoup losses at this price. Technology is not the place where there is ever going to 'winner take all.'
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Anonymous Coward, 19 May 2007 @ 3:42pm

some people may remember something called "xbox." with it, microsoft lost tremendous amounts of money, but successfully broke into a new niche: the living room.

for a company with as many financial resources as microsoft, not only can they afford to throw money around, but they also clearly are willing to take a financial hit, to expand their market.

we will surely see a bubble again (albeit a smaller bubble; investors have learned their lessons right?), but I do not feel microsoft's acquisition of Aquantive should be interpreted as road sign hinting that another economic sinkhole is waiting just around the bend.
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Yong Su Kim, 20 May 2007 @ 11:30pm

There are better ways to spend $6B
It's definitely a desperate move on Microsoft's part. Given all the high profile deals they lost to Google, I'm sure there was pressure on the deal team to close a deal.
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anonymous coward, 21 May 2007 @ 10:04am

motion does equal direction
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